BBTalk Company Limited sells tiles and other decoration products. Data of the store's operations are as follow:

Sales are budgeted at $340,000 for November 2019, $320,000 for December 2019, and $330,000 for January 2020.

Collections are expected to be 85% in the month of sale, 14% in the month following the sale, and 1% uncollectible will be recorded as bad debt expense.

The cost of goods sold is 60% of sales.

The company purchases 78% of its merchandise in the month prior to the month of sale and 22% in the month of sale. Payment for inventory is made in the month following the purchase.

Depreciation is $20,200 per month.

Other monthly expenses to be paid in cash are $18,000.

Other information as at 31 Oct 2019: Cash $42,000 Accounts receivable (net of allowance for uncollectible accounts) $85,000 Accounts payable $218,000

Ignore taxes.

Required:

a. Prepare a Schedule of Expected Cash Collection for November and December. (8 marks)

b. Prepare a Merchandise Purchases Budget for November and December. (10 marks)

c. Prepare a Cash Budget showing the captions with figures of beginning, excess/(deficiency), ending balance and so on for November and December. (10 marks)

d. Prepare an Income Statement Budget for November and December. (15 marks)